5 Most Common Deductions Business Owners Miss

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At the end of the year, most of the business owners get astonished to see the high tax figures in their corporate tax returns. That’s because they don’t consider various legitimate expenses that can save them the handsome amount.

Business owners generally put all burden on accountants to calculate their income and expenses. Accountants not only record those transactions that are provided to them by the business owners, but some professionals can guide businesses to save taxes.

Even the smartest of business owners could possibly give a satisfied answer if asked about including all tax deductions in his corporate tax return. This is the reason why private institutions exist – to help businesses find opportunities to save money.

Imagine, how much tax you can save if you include research and development charges (if you haven’t already added them as long-term expenses)? Then there’s more to it, such as:

  • Home office expenses,
  • Insurances expenses,
  • Interest on debts,
  • Legal fees,
  • Professional fees and many more.

Professionals such as accounting services Edmonton can actually give you a better chance to reduce your tax payables sufficiently. While you can consult Edmonton accountant and find great help, here you can learn about 5 common tax deductions often ignored by business owners.

Legal and Professional Charges

If you’re paying someone, a freelancer may be, to prepare official documents, tax returns, or other legal papers, these charges should also be considered as expenses, and are deductible. Didn’t you pay to your attorney to prepare those loans documents? Aren’t you paying Edmonton accountant for preparing tax refund applications? Even if you didn’t achieve your purpose, you can include these expenses to save taxes.

Organization and Business Startup Costs

Startups and business may qualify to save up to $5000 in terms of startup cost and $5000 for organization cost. You can ask your tax consultant or tax law lawyer about the eligibility criteria.

Daily Office Expenses

Where do you get the money when you need to spend on the business meeting, quick office repairs, new stationery and all? You have a petty-cash to take care of daily expenses in your office. However, it is one of those tax deductions that can easily be ignored. If you spend $100 on average from your petty cash, multiply the amount by the number of working days in the year and see how much difference it can make.

Car Expenses

Are you using that car for free? Don’t you attend business meetings and go to your office regularly in that car? Although car expenses require some recording to do, it is possible that you can include it as the tax deduction. All you need to do is to maintain a log of your business activities, purpose, and the expenses incurred.

Carrying Charges

The fees and interest you paid on a property can also be used as tax deductions. Any Edmonton corporate accountant would tell you, if you haven’t counted some of the carrying charges as long-term expenditures, you can use them to reduce taxable amount.